EXHIBIT 10(cc)
1998 - 2000 STRATEGIC INCENTIVE PROGRAM
Terms and Conditions
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1. The Right
This Right entitles you to receive performance units in the event that certain
financial goals are achieved with respect to the calendar years 1998 through
2000 (the "Performance Period").
2. Performance Criteria
The definition of the goals, for purposes of this Right, is set forth in Exhibit
A. The inclusion of the effects of unusual items in the calculations shall be at
the complete discretion of the Compensation Committee of the Directors of TRW
(the "Committee").
A goal scoring sheet for each of the three years in the Performance Period and
weighted award levels related to each of the goals is set forth in Exhibit B.
The Organic Sales goals will be adjusted to include sales attributable to
acquisitions as specified in the acquisition "buy plan." The Return on Sales
goals will be adjusted to reflect the inclusion of MPAT and sales attributable
to the acquisition as specified in the acquisition "buy plan."
3. Payment
Promptly following the availability of year-end financial information, the
number of performance units to be paid out will be determined by multiplying
33.0% of the target grant by the payout percent generated by the goal scoring
sheet for each of the first two years of participation in the Program and 34.0%
in the third year. Each performance unit will be converted into cash at the
average of the high and the low sale price averages of a share of TRW Common on
the New York Stock Exchange Composite Transactions Listing for each day on which
such shares are traded on the New York Stock Exchange during the months of
December and January immediately prior to the date of payment. This amount will
be paid to you in the currency in which you receive your compensation.
4. Taxes
Upon any payment pursuant to this Right, TRW will deduct any withholding or
other taxes due.
5. Transferability
This Right is not transferable other than by will or the laws of descent and
distribution.
6. Death
In the event of your death, your estate or those so designated by will or the
laws of descent and distribution will be entitled to receive, at such times as
you would have received payment, such payment as would have been paid to you
hereunder if you had remained employed throughout the entire year in which your
death occurred and the following year of the Performance Period, if any.
7. Termination of Employment
This Right shall terminate on the date of your termination of employment and you
shall not be entitled to any additional payments hereunder except for any
payments with respect to calendar years prior to the calendar year of your
termination. However, if your employment is terminated during the last half of
a calendar year, and if the Committee gives written consent on or prior to the
date on which payments are to be made pursuant to this Right with respect to
such year, you will be entitled to receive such payments as would have been
issued to you hereunder if you remained employed through the end of the calendar
year during which your employment terminated multiplied by the fraction
representing the number of full months employed during such year.
8. Disability
Notwithstanding the foregoing, if your termination of employment is due to
disability for a period of more than twelve months (as determined in accordance
with the TRW Long-Term Disability Plan), you will be entitled to receive such
payment as would have been issued to you hereunder if you had remained employed
for the entire year in which the disability occurred and the following year of
the Performance Period, if any.
9. Adjustments
The Committee shall make such adjustments in the number and kind of grants
pursuant hereto as it may determine are equitably required to prevent dilution
or enlargement of your rights that would otherwise result from any stock
dividend, stock split, combination of shares, recapitalization or other change
in the capital structure of TRW, merger, consolidation, reorganization, partial
or complete liquidation or other corporate transaction or event having an effect
similar to any of the foregoing.
10. Amendments
In addition to the authority to make adjustments as provided in Section 9, the
Committee shall have the authority, until such time as a Change in Control as
defined in Section 11 occurs, to amend otherwise this grant. Notwithstanding the
foregoing, if you transfer positions or change responsibilities within TRW, the
Committee may amend this Right to reflect such changed circumstances; provided,
however, that any such amendment after a Change in Control occurs shall not
reduce the value of this Right to you.
11. Change in Control
In the event of a Change in Control of TRW, this Right will remain in effect so
long as you continue to be employed by TRW. For purposes of this Right, the
definition of Change in Control is the same as the definition contained in
resolutions adopted by the Compensation and Stock Option Committee on July 26,
1989. Such resolutions, in summary, provide that a Change in Control is a change
occurring (a) by virtue of TRW's merger, consolidation or reorganization into or
with, or transfer of assets to, another corporation or (b) by virtue of a change
in the majority of the Directors during any two-year period unless the election
of each new Director was approved by a two-thirds vote of the Directors in
office at the beginning of such period or (c) through the acquisition of shares
representing 20 percent or more of the voting power of TRW or (d) through any
other change in control reported in any filing with the Securities and Exchange
Commission, excluding, however, the acquisition of shares, or any report of such
acquisition, by TRW, a subsidiary of TRW or a TRW-sponsored employee benefit
plan. The language in the resolutions controls over this summary language.
If a Change in Control occurs you will be entitled to receive any payment
issuable to you but not yet issued with respect to any completed calendar year
in the Performance Period preceding the Change in Control. In addition, with
respect to each of the remaining years in the Performance Period, you will be
entitled to receive payment equal to the number of units payable assuming
maximum performance on all goals. The aggregate number of units payable with
respect to the year of the Change in Control and subsequent years in the
Performance Period, determined in accordance with the precedence sentence, will
be issued to you promptly following the Change in Control.
12. Miscellaneous
This Right shall not be construed as giving you any right to continue in the
employ of TRW. Subject to the requirements and limitations in Sections 10 and 11
above, the Committee has authority to interpret and construe any provision of
this grant and any such interpretation and construction shall be binding and
conclusive. Except as provided in Section 11 above, no rights hereunder shall
accrue to you with respect to any year in the Performance Period until such year
is completed and the goals performance for such year has been approved as
provided in Section 3 above. Thereafter your rights will be limited to those
expressly given by this Right.
13. Entire Agreement
This Right sets forth the entire understanding between you and TRW with respect
to the subject matter hereof and supersedes all prior agreements and
understandings, whether oral or written, relating hereto.
February 2000